Correlation Between Hengkang Medical and Cowealth Medical
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By analyzing existing cross correlation between Hengkang Medical Group and Cowealth Medical China, you can compare the effects of market volatilities on Hengkang Medical and Cowealth Medical and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Hengkang Medical with a short position of Cowealth Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengkang Medical and Cowealth Medical.
Diversification Opportunities for Hengkang Medical and Cowealth Medical
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hengkang and Cowealth is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Hengkang Medical Group and Cowealth Medical China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cowealth Medical China and Hengkang Medical is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Hengkang Medical Group are associated (or correlated) with Cowealth Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cowealth Medical China has no effect on the direction of Hengkang Medical i.e., Hengkang Medical and Cowealth Medical go up and down completely randomly.
Pair Corralation between Hengkang Medical and Cowealth Medical
Assuming the 90 days trading horizon Hengkang Medical Group is expected to generate 1.14 times more return on investment than Cowealth Medical. However, Hengkang Medical is 1.14 times more volatile than Cowealth Medical China. It trades about 0.07 of its potential returns per unit of risk. Cowealth Medical China is currently generating about -0.05 per unit of risk. If you would invest 257.00 in Hengkang Medical Group on September 1, 2024 and sell it today you would earn a total of 13.00 from holding Hengkang Medical Group or generate 5.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hengkang Medical Group vs. Cowealth Medical China
Performance |
| Timeline |
| Hengkang Medical |
| Cowealth Medical China |
Hengkang Medical and Cowealth Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hengkang Medical and Cowealth Medical
The main advantage of trading using opposite Hengkang Medical and Cowealth Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengkang Medical position performs unexpectedly, Cowealth Medical can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Cowealth Medical will offset losses from the drop in Cowealth Medical's long position.| Hengkang Medical vs. Xinjiang Baodi Mining | Hengkang Medical vs. Zhejiang Qianjiang Motorcycle | Hengkang Medical vs. Hainan Mining Co | Hengkang Medical vs. Guocheng Mining Co |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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